I believe the company has reported to the market enough. I don't believe management are MIA. In fact, management are putting 100% of their focus on exactly the thing they should be focused on........the business.
It is understandable that investors are nervous with such a big drop in the share price and the continued volatility. However, management can't control stock market volatility. What management can do is focus on the business and navigating the once-in-a-lifetime challenges thrown at them by COVID and Brexit.
BVS was priced as a growth stock. In other words, when BVS was near $6 it was priced to perfection. The SP is a forward looking metric so a BVS share price over $4 assumes YOY growth. Over $5 assumes double-digit YOY growth. When BVS reported flat YOY growth, all the punters speculating on future growth headed for the exits.
I don't think there is anything calamitous about flat growth. In fact, given the extreme impact of COVID on the UK, not to mention Brexit, I am somewhat surprised that BVS can actually maintain their earnings guidance at pre-pandemic, pre-Brexit levels.
It can be informative to look at two other tech stocks - Appen and Altium. Both started off 2020 advising the market that their business models (and hence their revenue, earnings, and profits) would not be impacted by COVID19. In fact, I seem to recall that Altium went so far as to say that they were actually "immune" to the impacts of COVID19. Subsequently, the Appen SP reached a new all-time high of $43.66 a share and Altium hit a new high of $42.76.
And then what happened? Come the end of 2020 calendar year, both companies had to inform the market that:
a) COVID19 actually has impacted their businesses b) The impact is NEGATIVE - revenue, earnings, and profit downgrades from both! Unlike BVS, which has kept its guidance flat.
Appen's share price is now $23 (a drop of 47%), getting as low as $21.70 and Altium's share price $30.66 (a drop of 28%), getting as low as $28.
Both companies are very high growth businesses, and both were priced to perfection. They are tech darlings, part of the golden WAAAX group (which BVS has never been), who believed, and perhaps had good reason to believe, that COVID would not impact their businesses. But even they have had to concede that COVID has had a significant impact on them.
BVS is no different. Covid will continue to impact the whole of 2021. This will be reflected in earnings and share prices. Hopefully, the vaccines will be as successful as hoped for, and 2022 will see a return to normalcy, growth, and elevated share prices. If we're really fortunate, this may start to happen earlier, in mid to late 2021.
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